§ 39-78. Exemptions, generally.

There is hereby specifically exempted from the tax levied by this article the gross receipts or gross proceeds exempted from the State Sales Tax Code inclusive, but not exclusive of, and derived from the:

(1)

Sale of low point beer taxed as provided by state law.

(2)

Sale of cigarettes and such tobacco products as are taxed by state law.

(3)

Sale of raw products from the farm, orchard or garden, where such sale is made by the producer of such raw products directly to the consumer or user; gross receipts or gross proceeds derived from the sale of livestock, poultry, poultry products, and dairy products by the producers.

a.

Exemptions granted by this subdivision shall not apply:

1.

When such articles are sold, even though by the producer thereof, at or from an "established business place" not on a farm.

2.

Unless said articles are produced or grown within the state.

b.

The provisions of this subsection are intended to exempt:

1.

The sale by livestock producers of livestock sold at special livestock sales.

2.

The sale of dairy products when sold by a dairyman or farmer who owns all of the cows from which the dairy products he sells are produced.

c.

The provisions of this subsection shall not be construed to exempt:

1.

Sales of dairy products by any other business.

2.

Sales by florists, nurserymen and chicken hatcheries.

d.

Sale on or after February 16, 1967, of farm machinery to be used directly on a farm or ranch in the production, cultivation, planting, sowing, harvesting, processing, spraying, preservation or irrigation of any livestock, poultry, agricultural or dairy products produced from such lands. Each purchaser of farm machinery must certify, in writing, on the copy of the invoice or sales ticket to be retained by the seller that he is engaged in farming or ranching and that the farm machinery will be used only in farming or ranching.

(4)

Dues paid to fraternal, religious, civic, charitable or educational societies or organizations by regular members thereof; provided, such societies or organizations operate under what is commonly termed the lodge plan or system, and, provided such societies or organizations do not operate for a profit which inures to the benefit of any individual member or members thereof to the exclusion of other members.

(5)

Sale of tangible personal property or services to or by churches, except where such organizations may be engaged in business for profit or savings, competing with other persons engaged in the same or similar business.

(6)

Gross receipts and gross proceeds deriving from the transportation of school children to and from schools and high schools in motor and other vehicles.

(7)

Transportation of persons where the fare of each person does not exceed $0.15, or local transportation of persons within the corporate limits of cities and towns except by taxicabs.

(8)

Sale of food in public, common, high school or college cafeterias and lunch rooms operated primarily for teachers and pupils, not operated primarily for the public and not operated for profit.

(9)

Carrier sales of newspapers and periodicals made directly to consumers. Other sales of newspapers and periodicals where any individual transaction does not exceed $0.25. A carrier is a person who regularly delivers newspapers or periodicals to subscribers on an assigned route.

(10)

Sales to the United States government, the state, or any of its political subdivisions.

(11)

Sale of gasoline or motor fuel on which the motor fuel tax, gasoline excise tax or special fuels tax has been paid to the state.

(12)

Sale of crude petroleum or natural or casinghead gas and other products subject to gross production tax under the provisions of the laws of this state. This exemption shall not apply when such products are sold to a consumer or user for consumption or use, except when used for injection into the earth for the purpose of promoting or facilitating the production of oil or gas.

(13)

Sales of motor vehicles, attached optional equipment and accessories, on which sale the state motor vehicle excise tax has been paid.

(14)

Sales by county, district and state fairs.

(15)

Sale of advertising space in newspapers and periodicals and billboard advertising service, and sale of time for radio and television broadcasts of advertising.

(16)

Sales for resale to persons regularly engaged in the business of reselling the articles purchased, whether within or without the state, provided that such sale to residents of this state are made to persons to whom sales tax permits have been issued by the state tax commission as provided by law. This exemption shall not apply to the sales of articles made to persons holding permits when such persons purchase items for their use and which they are not regularly engaged in the business of reselling; neither shall this exemption apply to sales of tangible personal property to peddlers, solicitors and other salesmen who do not have sales tax permits or established places of business.

(17)

Goods, wares, merchandise, and property sold for use in manufacturing, compounding, processing, assembling or preparing for sale shall be classified as having been sold for the purpose of resale or the subject matter of resale only in the event:

a.

Such goods, wares, merchandise, or property are purchased for the purpose of being manufactured into a finished article and if it becomes a recognizable, integral part of the manufactured, compounded, processed, assembled or prepared products; or

b.

If it is consumed in the process of manufacturing, compounding, processing, assembling or preparing products for resale.

(18)

Sale of machinery and equipment purchased and used by persons establishing new manufacturing or processing plants in the state, and machinery and equipment purchased and used by persons in the operation of manufacturing plants already established in the state; provided, this exemption shall not apply unless such machinery and equipment is incorporated into, and is directly used in, the process of manufacturing property subject to taxation hereunder. The term "manufacturing plants" shall mean those establishments primarily engaged in manufacturing or processing operations, and generally recognized as such.

(19)

Sale of tangible personal property manufactured in the state when sold by the manufacturer to a person who transports it to another state for immediate and exclusive use in some other state.

(20)

Sale of an interest in tangible personal property to a partner or other person who after such sale owns a joint interest in such tangible personal property where the state sales or use tax has previously been paid on such tangible personal property.

(21)

Sales of containers shall be exempt when sold to a person regularly engaged in the business of reselling empty or filled containers; or when he purchases such containers for the purpose of packaging raw products of farm, garden or orchard, for resale to the consumer or processor; provided, this exemption shall not apply to the sale of containers used more than once and which are ordinarily known as returnable containers unless a tax under this article is collected and paid to the tax collector with respect to each and every transfer by such person of title or possession of such returnable container if made to any consumer or user within this state; nor shall it apply to the sale of labels or other materials delivered along with items sold but which are not necessary or absolutely essential to the sale of the sold merchandise.

(Code 1966, § 6-13; Code 1982, § 28-23; Ord. No. 1160, § 6, 4-25-1966)

State law reference

Exemptions, 68 O.S. § 1355 et seq.